Five Misconceptions about China

I was going to title this post Five of the Common Myths of Doing Business in China but decided that myth is not the best choice of words here. A myth is usually defined in one of two ways:

1. A commonly held belief that is not true. A misconception. For example, the myths in Scott Berkun's book, The Myths of Innovation.
2. A truth story. As in Icarus or The Rabbit and the Hare. Also, the universal truths embodied in "celebrity" brands.

I believe that the correct definition of myth is the second of these. Myths teach or remind us of universal truths. As Scott Berkun argues in his book, dull facts don't sit well with us and get replaced by myth-like stories. We mythologize the mundane, unglamorous process of innovation to pass on truths or, perhaps, to make life more colorful. As a result, the process of innovation appears magical and random, which it is not.

Why get my knickers in a twist over this? Well, hello, when we talk about innovation, it's important to have the vocabulary nailed. No ambiguity allowed. We need a vocabulary that will satisfy the most demanding of engineers and scientists. Dare I say that we need a language that would satisfy even the most demanding German or Russian engineer? We can't repeat innovation if we don't get the vocabulary sorted out once and for all. At the moment, the vocabulary of innovation remains still a problem at firm, regional and national levels.

Myth and misconception: not the same.

What are some of the most common misconceptions about China? Here are five (there are many more):

1. China has a centralized government.
2. Chinese culture is collectivist.
3. China is a young nation.
4. China is the world's biggest exporter.
5. The stock market in China is decoupled from the American stock market.

For an interesting video from INSEAD with the authors of The Future of Chinese Capitalism, check out the following link. The audio (MP3) can be downloaded here. Many of the areas mentioned during the interview by the authors have been covered before by Francis Fukuyama in his wonderful book, Trust.